New set back in balancing CA budget crisis

[mading6]

Originally Posted by Ultrarunner

True, California State Property Tax is fixed at 1% of the homes Value upon transfer with annual home value increases limited to 2%

The reality is some of us CA Homeowners, especially those with modest homes are paying close to 1.4%.

So could my mother sell her properties to me for nothing to reduce our property taxes? Let's say for example we paid $100,000 for our house (these are fake prices, but let's make it easy) then could I buy from my mom for let's say $10,000.00 and only pay 1% of the $10,000.00?

[BennyPhoenix]

Originally Posted by mading6

So could my mother sell her properties to me for nothing to reduce our property taxes? Let's say for example we paid $100,000 for our house (these are fake prices, but let's make it easy) then could I buy from my mom for let's say $10,000.00 and only pay 1% of the $10,000.00?

The tax assessors are not that stupid. People try that and get caught. You can get away with a small amount, say a 2 or 3% reduction. Anything out of the ball park will get flagged and investigated.
On the flip side, if you do that, when you sell the property you will have a huge gains tax to pay.

[BayAreaHillbilly]

Originally Posted by killer2021

The budget crisis is going to get worse. I have been looking at the budget numbers (I am studying accounting so yes, I did enjoy it haha). The first thing to look at is where is the money coming from. See this chart for where the $$ is coming from:



As you can see, the largest source is from personal income tax and the second is sales tax. Nearly 70% of the revenues are coming from these two sources. Now, here is where the problem arises. CA is in a major economic meltdown. Job loses are high as well as unemployment. When people are unemployed they don't pay income taxes and they don't spend as much. To say the least in the next couple years CA is going to see these two sources of revenue drop. This will make the crisis that much worse.

We also need to look at where the money is going:



Education and health/human services comprise nearly 65% of the spending. If we are to tackle the root of this problem that is where we need to look.

Doing a straight line cut is a quick fix but not in the long run. You need to go in there cut out the fat and make it more efficient. We need to go after spending simple as that. Raising taxes will only LOWER the overall tax revenue. As you can see, more people are leaving CA than coming in. That could be a big problem. People are getting to the point of saying, "Why stay in CA and pay 0-10% personal income tax when I can go to Texas and pay no income tax? I am one of them.

Need to get people with corporate cost cutting and restructuring experience then give them carte blanche to go into the Edu, health and human services "supply chains" to reorg, trim, fire, etc. Of course with those all being union operations that would be easier said than done. Plus, you can bet your boots that once some of the tough managers I allude to here started to execute, all the usual cry babies and interest groups would be crying to the media. Remember those billboards and smear campaigns done by nurses and teachers during Arnie's first term? You'd see that sort of thing again but far worse.

[BayAreaHillbilly]

Originally Posted by cobmw

I guess that they were trying to avoid having old people get in a spot where they can't pay their taxes.

Too much yackety-yak about collecting taxes. Hey Democrats how about some serious talk about cutting spending in a big way? Yea I know - you need the tax money to buy votes by promising things to people. Don't you Democrats have kids who will need to work and live in a prosperous California? Don't you care at all?

Here the Left is made up of wealthy people, and, the poorest people.

Many of the wealthy Leftists don't have kids, or, have one kid, who they can afford to give the best in "day care" and private schooling.

The poor simply do not comprehend all of this due to lack of education and expertise.

[BayAreaHillbilly]

Originally Posted by nevergoingback

So assessed (taxed) value does change while you own your home in CA. It's just capped at a max of 2% a year, unless improvements are made or ownership is changed, then it gets assessed at market value. Got It! I always thought my prop taxes went up each year when I lived there.

One of the previous posters had said assessed value doesn't matter for property taxes in CA, which I guess is incorrect.

Sorry to get off topic on you, thanks for the info!!!

According to this group, repealing Prop 13 would cure the budget crisis in CA. Any thoughts? How about maybe only for Disneyland?

Repeal Prop 13 Organization

There are many misconceptions about Prop 13, of course, many such misconceptions are promoted by the tax and spend fanatics who are hell bent on overturning Prop 13. The shibboleths include:
- Property taxes are not raised YoY (false)
- In most neighborhoods a small minority of people carry the lion's share of the property tax burden (false - there are almost no neighborhoods with that level of stability in terms of turn over and improvements)
- There is a correlation in inflation adjusted terms between the onset of Prop 13 in 1978 and a reputed decline in per student education funding (doubly false regarding both correlation factor as well as the assertion that funding has relatively decreased)
- Prop 13 was and is a plot by "right wingers" to "attack Sacramento" in terms of jurisdiction and capability (e.g. a radical "illiberal" attack on the status quo). (false - support was completely non ideological in distribution and largely continues to be)

Etc.